What is Capital Reserve? State its uses.

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Meaning: The reserve which is created out of capital profit and cannot be used fordistribution of dividend is known as capital reserve. Uses: Capital reserve can be used for the following purposes:
$(1)$ To write off loss onsale of fixed assets
$(2)$ To write off intangible assets like good will and fictitious assetslike preliminary expenses, discount on issue of debentures, etc.
$(3)$ For distribution of bonus share, to shareholders if there is provision in Articles of Association of the company.
$(4)$ Dividend can be paid out of capital reserve only under specific circumstances subjectto certain conditions.

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Pass necessary journal entries from the following account.

Dr.	Ledger of Yogesh Pranav Account						Cr.
Date	Particulars	J. F.	Amt. (₹)	Date	Particulars	J. F.	Amt. (₹)
$2018$ July				2018 July
$7$	Bills payable A/c		$20,000$	$5$	Purchase A/c		$36,800$
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	Discount A/c		$800$
$16$	Purchase return A/c		$1500$
$18$	Bank A/c		$11000$
$31$	Balance c/f		$10000$
			59,300				59,300